“Why ATA?”

“With the help and experience of ATA’s partners, my company had a successful strategic exit in record time, despite the difficult economy of 2009.”

During the worst economy in decades, in August of 2009, EMC Corporation announced the strategic acquisition of FastScale Technologies, an innovator of virtualization and cloud computing deployment technologies. By dramatically simplifying and automating application and server software stack management, FastScale’s solution optimized the deployment for physical, virtual and cloud infrastructures. FastScale was proven to allow data centers to run up to three times more virtual machines and provision new servers in seconds, rather than hours.

“With FastScale, we not only give customers deeper management capabilities via FastScale’s unique application stack management and provisioning, but we also begin to help customers fundamentally change the way they approach compliance, security and configuration management in the private cloud.” EMC press release, 2009

A successful exit often begins with calculated steps with a strategic partner, as was the case with EMC and Fastscale. The efforts to construct a lasting strategic relationship between the companies began long before the offer was tendered. In early 2009, the company approached EMC about incorporating FastScale technologies into EMC’s product portfolio. As these discussions matured, FastScale’s CEO, Lynn LeBlanc, engaged EMC’s corporate development team in discussions of a potential investment in FastScale. Ms. LeBlanc turned to ATA’s Hatch Graham for guidance on constructing the strategic investment to grow the EMC relationship without constraining the company. As a result, Hatch worked directly with EMC’s corporate development team to craft a mutually beneficial investment opportunity, while maintaining sufficient autonomy to avoid restricting FastScale’s competitiveness in the market. The result was a highly successful strategic round of financing, led by ATA, supported by other insiders, and attracting EMC.

“Hatch led us through the strategic round while avoiding the difficult demands often levied by strategic investors. By working directly with EMC in advance of crafting a Term Sheet, Hatch’s efforts resulted in terms that were attractive for all parties involved, including FastScale’s founders, employees, inside investors, and the new strategic investor.” Lynn LeBlanc, CEO

Completed in March of 2009, the financing was a success. In addition to providing a boost to FastScale’s balance sheet, it increased EMC’s visibility into the impressive advantages of FastScale’s technologies and employees and also resulted in a formalized product roadmap between EMC and FastScale. These steps were key to the subsequent strategic acquisition of FastScale, only 1.5 years after commercially launching its first product. In spite of such a devastated economy, FastScale’s shareholders enjoyed returns far above the market benchmarks surrounding the Enterprise IT segment, reflecting a superior level of respect for the value of FastScale.